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It's a Saturday evening on Kwun Tong promenade, formerly known as the public cargo working area. Under the flyover stretching alongside it, children are dancing to electro music being played by a DJ. This is the Forgotten Dreams Carnival, an arts and music event originally planned for last year. Licensing hurdles forced organiser Paul Yip, of the Feel Music Experimental Lab, to postpone the event to earlier this year, holding it in Kwun Tong instead of To Kwa Wan.

As Yip sees it, their initial setback eventually worked for them. The location made it convenient for bands to transport their gear since most had rehearsal rooms in Kwun Tong's many industrial buildings. Best of all, they were able to stage the carnival as a guerilla event, avoiding interminable red tape, including the need to apply for a temporary public entertainment licence.

But when a henna artist tries to move her booth to the promenade for better lighting, staff from Leisure and Cultural Services Department turn her back.

The line that apparently separates the promenade and flyover defines the absurdity of staging outdoor cultural activities in Asia's self-proclaimed World City. And it reflects just a small fraction of the frustrations that the cultural community in Kwun Tong faces.

Previously known as a zone for light industry, Kwun Tong has grown to encompass an informal arts and music "village" as performers and designers of various stripes have taken up residence in disused factory space. An estimated 600 to 700 bands rent premises in the area, along with design collectives, art studios and galleries.

The spectre of rising rents is a given in Hong Kong, but of late it's casting an even darker shadow for groups in Kwun Tong.

Yip, a long-time resident of the area, has seen steep rises in rentals driven by government plans to turn Kowloon East, comprising Kai Tak, Kwun Tong and Kowloon Bay, into a "premier" commercial district.

Changes have gathered pace since the Energising Kowloon East (EKE) Office was set up last June. Presenting the plans as a revival of old districts, officials scheduled a concert for local performers in late January, Flyover Operation One, to generate buzz.

But many groups suspected urban renewal was mostly property development under a different name.

And when Kimi Lam Hiu-ha, of live music house Hidden Agenda, posted a message on Facebook urging bands to scrutinise the aim of the concert, it was doomed. Musicians boycotted the event, forcing its cancellation.

Only then did red-faced EKE officials seek a meeting with Hidden Agenda organisers and visit the venue. Dialogue with the cultural community may have come a little late, but Lam is staying positive. A second meeting was tentatively scheduled for this month, but nothing was confirmed at the time of printing.

There is no future for us if we can't operate legitimately

Kimi Lam, hidden Agenda

"The EKE Office may think they are helping us, but they're not. We [Hidden Agenda] aren't necessarily anti-government. We're open to discussion, otherwise we will die out."

The live music club, which some view as Hong Kong's equivalent of CBGB in New York, has long struggled for official acceptance. Although a paying concern, Hidden Agenda is frustrated in securing legitimacy for its operations. Since opening in 2009, the club has constantly received warnings from the Lands Department regarding its use of premises that are restricted to industrial or godown purposes.

"We were sent bouncing like a ball between different departments because none can shoulder a big issue like cultural policy alone," Lam says. "But why aren't creative industries a kind of industry anyway? There is no future for us if we can't operate legitimately."

It isn't just the survival of Hidden Agenda that hangs in the balance. Kwun Tong encapsulates the challenges of ensuring a habitat for creativity to mature and blossom, Lam says.

"If West Kowloon Cultural District is a university for musicians to showcase their talents to the world, then Hidden Agenda is like a secondary school. Without our graduates, where can they find musicians to step on the bigger stage?"

Soaring property prices have knock-on effects beyond difficulties balancing the books. For instance, where two bands might have shared a rehearsal room in the past, now three to four outfits must split costs to afford the space, which means each has less time to practise, says Yip, who performs with indie rockers Tree Phoning. Half-jokingly, he wonders if the government could carve out a "public estate" for bands.

In the wake of its concert fiasco, the EKE Office says it will continue to engage different "stakeholders" , including the cultural community and government departments, so that Kowloon East will become a business district with "special character".

At the Easy-pack Industrial Building on Wai Yip Street, a handful of enterprises are injecting vibrancy into the otherwise drab environment. Designer Aidan Li Ka-cheuk initiated the process in 2009 when he convinced his family to develop three floors of the property into a creative hub. It now houses, among other things, recording studios for heavy metal veterans King Lychee, design collective The Cave, and Radiodada, an online radio station founded by subculture hero MC Yan.

The roof is taken over by designer Michael Leung's HK Honey and HK Farm, where herbs and vegetables thrive in compost derived from food waste collected from nearby canteens.

Installation artist Phil Kan has seen gleaming, if soulless, high-rises and hotels march across the landscape since he took up a studio in Easy-pack three years ago and worries that the creative community that has sprouted up there will soon be priced out. "In Kwun Tong and Ngau Tau Kok you find not only music, arts and cultural units, but also an indoor football pitch, skating rinks and tattoo artists. And it's like everyone knows everyone here.

The government cannot lead arts development, but it can give artists a push in meeting rules and regulations and help where possible

Oscar Ho Hing-kay, curator and art commentator

"Artists may have moved to [cheaper] areas such as Tsuen Wan and Kwai Chung, but it will take a long, long time to rebuild that community bond."

Veteran curator and art commentator Oscar Ho Hing-kay foresees a looming disintegration of existing cultural hubs as the fallout from one-track cultural policy. "It's a common problem in Hong Kong. Instead of pushing what already exists and fostering its organic growth, the government builds something brand new. They want to create an arts and culture village, so they build West Kowloon."

For a hint of what Kwun Tong's high-gloss renewal may bring, he cites the gentrification of New York's Soho district, where artists occupying cheap warehouses were forced out as cafes and galleries moved in.

The drive to commercialise Kwun Tong will essentially kill its arts scene, he says. "It is important to treasure the organic growth of the arts community and its cultural identity. The government cannot lead arts development, but it can give artists a push in meeting rules and regulations and help where possible."

Li, who helped transform a former police station in Sydney into a self-sustainable art space in 2006, suggests artists must take a more active role using social media and other avenues to connect with the public and let people know what they are doing.

Anson Mak Hoi-shan, an independent filmmaker who initiated online archive A Map Of Our Own - Kwun Tong Culture and Histories, says the current land use policy undermines social cohesion.

"A lot of people assumed the need for industrial space would fall as the city became more commerce-oriented. But that's not true. From artist studios to places like indoor sports venues, cookery workshops or film studios, they all need that space."

Bodies such as the Factory Artists Concern Group have constantly voiced their needs to government, but in vain, says Mak,

In a broader sense, she sees community bonding as a basis of a democratic society. "If people are forced to move regularly, they can't develop a cohesive sense of community. And democracy begins when people start to care for their community and take part in its affairs."

That means everyone has a responsibility, Lam says. "We have to let more people know about this and raise civil awareness. The media has to monitor what the government is doing. And artists will strive to create better, more significant work and make themselves worthwhile."

Creative ventures in Kwun Tong that are open to the public

Below is a sample of the innovative ventures in Kwun Tong that are open to the public.

Opened in 2009 by a group of young musicians and music lovers, the club promotes live independent music in Hong Kong. The 4,000 sq ft venue can now host audiences of 300 and sells indie CDs. Local talents My Little Airport and Chochukmo as well as international artists such as Tahiti 80 and MONO have all made their mark here.

Founded by designer Michael Leung in 2010, HK Honey is the first urban beekeeping unit in the city. Leung launched HK Farm two years later to promote the benefits of locally produced food. The collective behind the venture also runs urban farming-related services and various tours and workshops.

Established by seven young professionals in graphic, interior and fashion design, The Cave makes furniture from reclaimed wood. The collective has participated in DeTour events and other design exhibitions. Workshops are held regularly.

Opened two months ago, the 1,000 sq ft space is dedicated to local and international photography. Its debut exhibition, Mother Russia, features 16 images by four female photographers from Russia and runs until March 24. Lesser-known photography publications can also be found here.